Federal Government

<h2>Expert Observer</h2>

With the Federal election all but wrapped up, what can prospective buyers expect from the change in government, with the Labor party&rsquo;s win bringing a raft of policy changes.

With a look to address the property market&rsquo;s biggest issues,&nbsp; the headlining &lsquo;Help to Buy&rsquo; scheme is likely to be popular with prospective home buyers, as it provides a more affordable entry point to the Australian housing market for those individuals on low-to-mid level incomes.

This will contribute to more equality in rates of home ownership across income cohorts, and could create more opportunities for key workers to live in more central areas.

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Being able to share up to 40% of the purchase price with the government, along with only a small deposit and opportunity to save on lenders mortgage insurance, helps to overcome several of the hurdles of home ownership.

Keeping in mind buyers will still have to fund their transactional costs, including stamp duties, legal costs and bank fees.

Labor&rsquo;s Help to Buy scheme will involve an equity contribution from the Federal Government of up to 40 per cent of the purchase price of a new home, and up to 30 per cent for an existing home for 10,000 Australian&rsquo;s each financial year, with homebuyers needing just a 2 per cent deposit.

With a cap of 10,000 places, the scheme could be quickly oversubscribed as prospective Australian home buyers take advantage of the leg up into the housing market, Lawless says, highlighting the First Home Loan Deposit scheme, which saw the first 10,000 places of the scheme allocated within six months.

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However places for new homes were not taken up as quickly, and building constraints and high construction costs could deter the uptake of a shared equity scheme for new homes.

Having said that, a higher interest rate environment, which may see lower prices, could make people more cautious of buying, reducing demand for the scheme in the short term.

Historically, residential transaction activity correlates with property price movements. Additionally, we have just been through a period of significantly elevated transaction activity, including from the first home buyer cohort, where many home purchasing decisions were likely brought forward to take advantage of the swathe of home buying grants and incentives over 2020 and 2021.

The added flexibility of buyers being able to &lsquo;top up&rsquo; their ownership stake once in a better financial position is another advantage of the scheme, although any change in the proportion of ownership would presumably be accompanied by a paydown in the share of equity that has accrued in the property back to the government.

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Help to Buy scheme

<ul>
	<li>Government helps with up to 40% of property price for new homes, 30% for established, households source the rest of finance with as little as 2% deposit. Government holds a part ownership stake in the property, which can be bought out over time.</li>
	<li>Spots: 10,000 ▪ Income cap: $90k for individuals / $120k for couples</li>
	<li>Property price cap: varies by region, from $400k up to $950k ▪ Restricted to owner occupier buyers who don&rsquo;t currently own a property</li>
	<li>Commences from July 2022 Although the scheme is expected to be popular among buyers, Lawless warned anyone considering the scheme should be aware of the risks associated with buying on such a small deposit.</li>
</ul>

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With the housing market probably heading into a downturn over the coming year or years, some buyers may find their home is worth less than the debt held against it.

It&rsquo;s important to know if the government will share in the downside risk if the property is sold while in a negative equity situation.

KeyStart Loans in WA is a good example of what can happen to a shared equity scheme in a declining market. According to the WA government, the portion of KeyStart loan accounts in default did rise between January 2017 and September 2019, from 0.92% to 1.21% of KeyStart accounts, in the midst of a long, large housing downturn across WA.

However, he also added the default rate is still relatively low and the scheme has helped thousands of people into home ownership, saying, the nature of the housing and economic downturn in WA has posed a lot more risk to serviceability than the relatively tight labour market conditions we see in Australia at the moment.

While the Help to Buy scheme will help thousands of Australian&rsquo;s enter the property market, it&rsquo;s only addressing the symptoms of housing affordability rather than aim to actually fix the underlying issues.

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Similar to the First Home Loan Deposit Scheme, the new Labor Government appears to be adjusting from housing affordability solutions to more pragmatic policies that target home ownership, avoiding any downward pressure on housing prices.

It is also worth considering any demand-side incentives can add upward pressure to home prices. For this reason, the limited number of places in this particular scheme, along with price caps and income caps, should help to contain some of the excess demand that could result in upward pressure on prices.

Help to Buy is restricted to Australian&rsquo;s with a taxable income of up to $90,000 for individuals and up to $120,000 for couples. Capped at 10,000, applicants are also required to be Australian citizens and first home buyers.

Regional First Home Buyer Support Scheme 

<ul>
	<li>Government provides a deposit guarantee for regional home buyers with a deposit of at least 5%</li>
	<li>Spots: 10,000</li>
	<li>Income cap: $125k for individuals / $200k for couples</li>
	<li>Property price cap: varies by region, from $350k up to $800k to be reviewed half yearly</li>
	<li>Restricted to owner occupier buyers who haven&rsquo;t previously owned a property and have been living in the region for at least 12 months</li>
	<li>Commences from January 2023</li>
</ul>

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The Regional First Home Buyer Support Scheme extends the existing First Home Loan Deposit Scheme by providing an additional 10,000 places specifically for regional first home purchases, providing a guarantee of up to 15 per cent for eligible first home buyers &ndash; so that locals with a&nbsp;five per cent deposit can avoid paying mortgage insurance.

Based on the property price caps, the scheme is likely to be most popular for those buyers targeting a unit purchase, or lower priced regional markets where detached housing values are more affordable.

CoreLogic&rsquo;s analysis of regional Australian suburbs shows roughly one third recorded a median house value equal to or under the Regional First Home Buyer Support Scheme price cap, and 71.1 per cent recorded a median unit value equal to or less than the price cap.

The Labor party notes &lsquo;the housing crisis is hitting regional Australia the hardest&rsquo;, which isn&rsquo;t necessarily true from a purchasing perspective.&quot;

Although regional housing values have risen faster than capital city housing values over the past few years, we are still seeing the dwelling value to household income ratio across regional Australia (a ratio of 7.9 in March 2022) lower than the capitals (a ratio of 8.5).

From a rental perspective, regional renters have been dedicating a larger proportion of their incomes towards rent than the capital cities since 2017.

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Establishment of a National Housing Supply and Affordability Council 

<ul>
	<li>The newly established council would sit within an expanded remit of NHFIC (National Housing Finance and Investment Corporation) renamed Housing Australia. ▪ The council would: ▪ take a leadership role for setting land supply targets (in consultation state and territory governments)</li>
	<li>Establish a housing data warehouse focussed on housing supply, demand and affordability</li>
	<li>Advise on town planning policies and land supply</li>
	<li>Report on government owned land releases, rental affordability, homelessness and the number of new social &amp; affordable homes built annually</li>
	<li>Advise on appropriate housing measures within all current and future City and Regional Deals.</li>
</ul>

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Many of the factors contributing to worsening housing affordability, such as insuffficent land release and restirive town planning policies will soon be part of an extended remit for the reframed NHFIC, which would be re-branded as Housing Australia, The expanded role will administer the various government programs, including the Help to Buy scheme, existing deposit guarantee schemes and the Housing Australia Future Fund, as well as take responsibility for the newly created National Housing and Affordability Council and National Housing and Homeless Plan.

Lawless said NHFIC&rsquo;s expanded remit should help to address the issues that make housing unaffordable, while also providing more transparency and reporting about the release of government owned land and helping to steer policies related to social and affordable housing supply.

It was interesting to note Labor intends to fund some of these initiatives by applying higher fees on foreign buyer purchases.

Higher fees and costs associated with foreign buying activity comes after a recent history of substantially higher federal and state-based taxes on this buyer segment. In fact, this may have contributed to foreign buying approvals hitting record lows according to FIRB data.

Further disincentives for foreign buying have the potential to keep foreign purchasing at low levels, which could have a negative outcome on rental supply. Arguably, higher levels of foreign buying activity could help to alleviate the rental crisis Australia is navigating by introducing more rental housing into Australia, given that foreign buyers generally have to buy new homes.

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The Housing Australia Future Fund 

<ul>
	<li>A $10 billion initiative with the objective of funding social and affordable housing properties.</li>
	<li>Over the first five years the fund has a goal of building:
	<ul>
		<li>20,000 social housing properties &nbsp;</li>
		<li>10,000 affordable homes for key workers</li>
		<li>$200 million in maintenance/improvements of housing in indigenous communities</li>
		<li>$100 million for transitional housing options supporting women and children in domestic violence situations</li>
		<li>$30 million for housing veterans who are experiencing or at risk of homelessness.</li>
	</ul>
	</li>
</ul>

[smartcode_project:default project_id=90532 project_image_fid=180653]

With the stock of social housing increasing only marginally since 2006, investment in social and affordable housing is long overdue.

While the additional funding and housing support for disadvantaged sectors of the community is welcome, the 30,000 additional dwelling over five years remains insufficient.

A recent report from Brendan Coates at the Grattan Institute noted even with 100,000 extra social housing properties targeted towards people in most need, more than two thirds of low-income Australians would remain in the private rental market where national rents are currently rising at around 9% per annum.

National Housing and Homelessness Plan 

<ul>
	<li>Aims to establish key short, medium and longer term reforms making it easier for Australians to buy a home, rent and provide shelter for homeless Australians.</li>
</ul>

There is little detail so far on this initiative and the plan is yet to be formulated. However, the Labor party has expressed a commitment to working with a broad range of stakeholders including the states and territories, local governments, industry bodies, superannuation funds and other relevant experts on how to address housing, finance and urban development.

Tim Lawless is CoreLogic&#39;s Research Director.

Labor’s Help to Buy scheme will involve an equity contribution from the Federal Government of up to 40 per cent of the purchase price of a new home, and up to 30 per cent for an existing home


tlawless

What a Labor Government means for housing affordability and the Australian property market

The federal government has announced  that the federal budget will increase the maximum amount of voluntary contributions that can be released under the First Home Super Saver Scheme from $30,000 to $50,000. 

The FHSS Scheme was launched in the May 2017 budget designed to allow first homebuyers to use their super account to save some of the money they need for a home deposit.

The First Home Super Saver Scheme involves making before-tax contributions to superannuation.

The deposit comes by portioning a part of the aspiring first home buyer's income to be put into super account before tax.

It provides a lower tax scenario for the deposit being accrued. 

All contributions must be voluntary contributions, so Superannuation Guarantee (SG) amounts paid by your employer cannot be directed towards the FHSS savings.

FHSS contributions using a salary sacrifice arrangements can be used.

FHSS participants can not have previously owned a home in Australia, including an investment property, vacant land and commercial property.

Purchasers are obligated to live in the property for at least six of the first 12 months after purchase.

Previously the maximum a person can contribute each year under the FHSS Scheme is $15,000, with the maximum a person can save in total under the FHSS Scheme being $30,000.

“The expansion of the First Home Super Saver Scheme to allow the funds that can be withdrawn from $30,000 to $50,000 will boost its popularity and take up," said Denita Wawn, CEO of Master Builders Australia.

"Harnessing the power of compound interest in superannuation to save a deposit makes sense,” she said.

The FHSS does not permit access to the regular 9.5% super contributions.

The number of home builders through the scheme has been limited to date given the complexity of the scheme and the years required to build up a deposit.



The federal budget will see the adjustment of the First Home Super Saver Scheme to allow the withdrawal of $50,000 in funds 

jchancellor

$50,000 to be permitted in First Home Super Saver Scheme withdrawals

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<img src="https://counter.theconversation.edu.au/content/64733/count.gif" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The Federal Government’s plan to wind back superannuation tax breaks would create a fairer superannuation system more aligned to its purpose of providing income to supplement the Age Pension, according to new Grattan Institute analysis.
It would also contribute to budget repair.
The analysis shows how either of the reform packages proposed by both major parties would be a big step in the right direction. It explores how the current system provides much larger benefits to those with such ample resources that they will never qualify for an Age Pension. And it shows how the proposed changes would affect them - and pretty much nobody else.
As they debate the Coalition government’s proposals to wind back tax breaks on superannuation, politicians on all sides can do three big things: create a better and fairer superannuation scheme; take an important step towards repairing the Commonwealth budget; and show that our political system still works.
Both main parties have laid out their preferred reforms to super tax concessions. While they agree on all but the details, they are yet to strike a deal. Our new research shows what is at stake.
<h2>A better, fairer, super system</h2>
First and foremost, the proposed reforms to superannuation announced in the 2016 budget are about making super better, and fairer.
Tax breaks should only be available when they serve a policy aim. The purpose of super identified in the budget and <a href="https://sjm.ministers.treasury.gov.au/media-release/053-2016/">due to be defined in legislation</a> is to provide income in retirement to substitute or supplement the Age Pension. Super tax breaks don’t fulfil this purpose when they benefit those who were never going to qualify for an Age Pension in the first place.
The plans of both the government and the ALP would be big steps towards aligning super tax breaks more closely with their purpose. They would trim the generous super tax breaks enjoyed by the top 20% of income earners – people wealthy enough to be comfortable in retirement and unlikely to qualify for the Age Pension.
Retirees with large superannuation balances will start paying some tax on their superannuation savings, but still pay much less tax than wage earners on lower incomes. For a small proportion of women with higher incomes later in life, the changes will reduce their catch-up contributions. Yet the changes will reduce the tax breaks far more for wealthier old men.
Claims that the budget changes will affect many low and middle-income earners are wrong. Our research shows the changes will affect about 4 percent of superannuants, nearly all of them high-income earners who are unlikely to access the Age Pension. Nor are the proposed changes retrospective. Many reforms affect investments made in the past, and no-one suggests they are retrospective. Rather, the changes will affect taxes paid on future super earnings, and entitlements to make future contributions to super.
Any plausible combination of the packages on offer would make the super system fairer. At present, someone in the top 1% of income earners can expect to receive nearly three times as much in welfare and tax breaks from super in their lifetime as an average income earner. The government’s changes would trim some of these excesses: the top 1% would instead receive just twice as much as low or average income earners. And by targeting tax breaks that go to the top 20 percent of income earners, neither side’s plan would see much of an offsetting increase in Age Pension spending.
<h4><a href="/images/2016/09/06/image-20160904-20235-2lmns1.jpg" target="_blank">Click to enlarge</a></h4>
<img src="/images/2016/09/06/image-20160904-20235-2lmns1.jpg" alt="">
<h4>
Modelling on super reforms The Grattan Institute, Author provided
</h4>
<h2>An unsustainable tax system for seniors</h2>
Decisions by the former Coalition Government to abolish taxes on superannuation withdrawals in 2007 and radically increase the amount senior Australians could earn before paying income tax have dramatically reduced the tax bills of older Australians.
These changes are one of the main reasons why households over the age of 65 (unlike households aged between 25 and 64) now pay less income tax in real terms today than they did 20 years ago. At the same time, the workforce participation rates and incomes of seniors have jumped. Generous super tax breaks have been funded by deficits. The accumulating debt burden will disproportionately fall on younger households.
<a href="/images/2016/09/06/image-20160902-20241-1ljhnvu.jpg" target="_blank">Click to enlarge</a>
<h4><img src="/images/2016/09/06/image-20160902-20241-1ljhnvu.jpg" alt=""></h4>
Tax breaks to older Australians are also a major cause of the increase in the “taxed nots” identified by Treasurer Scott Morrison. The number of older Australians not paying any income tax has increased from three in four in 2000 to five in six today. The rise of these “taxed nots” coincides with the introduction of the Senior Australian Tax Offset in 2000, and tax-free super withdrawals in 2007.
<a href="/images/2016/09/06/image-20160902-20220-1h63t0l.jpg" target="_blank">Click to enlarge</a>
<h4><img src="/images/2016/09/06/image-20160902-20220-1h63t0l.jpg" alt=""></h4>
<h2>Repairing the budget</h2>
The increased cost of services and reduced taxes per older household explain in large part why the Commonwealth budget is in trouble. For eight years, budget deficits have persisted at about 2 to 3 percent of GDP, and the future looks little better. The returned Turnbull government is putting a priority on budget repair, now described as a “massive moral challenge” by the Prime Minister. Winding back some of the tax breaks given to older Australians during the happier times of the mining boom is an obvious step.
The government’s super package would save the budget at least A$800 million a year. Alternative proposals by the ALP, which broadly supports the Coalition’s reforms, and then goes further, would save more than A$2 billion a year. Should Treasurer Morrison seek a deal with the ALP or the Greens, any “concessions” will mostly improve the budget position.
Nor is the Turnbull government likely to find more attractive opportunities for budget savings. Unlike most of the government’s savings measures, changes to super tax breaks are broadly popular. Electorates more likely to be adversely affected by the super changes – that is, those with more old and wealthy voters – tended to swing less to the ALP at the last election than other electorates. And a survey before the election showed that the proposals had more support amongst those most likely to be adversely affected.
<h2>A test for our political system</h2>
Even after the reforms, super tax breaks will still mostly flow to high-income earners who do not need them, and the budgetary costs of super tax breaks will remain unsustainable in the long term. Further changes to super tax breaks will be needed in future. But agreeing to the super package now before the Parliament would be progress in the right direction. And there is a broader issue at stake.
Super is only the first of a number of difficult choices that will come before the Parliament as government seeks to promote economic growth in a sluggish global economy, and bring the budget back under control. There is no easy road to these ends that will keep everyone happy all the time. Pragmatic compromise will be critical.
The proposed changes to super tax breaks are built on principle, supported by the electorate and largely supported by the three largest political parties. If we cannot get reform in this situation, then our political system is in deep trouble. In coming weeks, our MPs have the chance to show how government in Australia can still change the nation for the better.
John Daley is chief executive officer, Grattan Institute, and author for The Conversation. He can be contacted <a href="https://theconversation.com/profiles/john-daley-1870" target="_blank">here</a>.
Brendan Coates is a friend of The Conversation and can be contacted <a href="https://theconversation.com/profiles/brendan-coates-154644" target="_blank">here</a>.
William Young is associate, Grattan Institute and can be contacted <a href="https://theconversation.com/profiles/william-young-260984" target="_blank">here</a>.
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jchancellor-FAypfDUnLy

New Grattan research shows what is at stake in the superannuation debate

<html><body>
GUEST OBSERVER
The Federal Government should reconsider changes announced in the 2017 Budget to allowable deductions for investment property related to depreciation and travel to inspect property, according to the Real Estate Institute of Australia (REIA). 
Whilst REIA supports the curbing of abuse of deductions, these two initiatives are contrary to the principles of a good tax system and the ATO has existing means for addressing abuses and excesses.
One of these principles is neutrality which in essence means that two tax payers in similar circumstances should be treated the same. These initiatives are contrary to this principle with the budget initiative of not allowing for travel to inspect residential investment property meaning that an investor who owns a commercial investment property can claim deductions for their annual site inspection travel costs but an investor who owns a residential property cannot. 
As the ATO itself points out on its website there are many valid reasons why an owner of investment property would incur costs travelling to a residential rental property. 
Whilst abuses and excesses should be eliminated there are other ways of achieving this through the ATO. The ATO has a myriad of information available to identify questionable claims. Conversely it will adversely impact those tax payers who are not abusing the system. 
Ironically these changes will do nothing to improve affordability in Sydney and Melbourne and indeed it may make it worse as investors in these two cities are discouraged from investing in locations other than their home towns. 
Anecdotal evidence is indicating that as Sydney and Melbourne prices have increased investors are turning to non-metropolitan locations. This regional investment brings employment for a multitude of regional services. This measure will put a brake on this trend. 
Regarding the proposal to restrict depreciation claims to items purchased and installed in the property by the claiming taxpayer, REIA believes, like travel, it doesn’t treat the investor buying a property that is 12 months old the same as one buying a new property. 
The ATO has monitored this area and has the ability to identify abuses and excesses and deal with them. We believe it will distort the market by making properties that are not new less desirable, and the impact on affordability is questionable and may even worsen affordability as existing investors hold on to their property and new investors push up the price of new property which are currently showing signs of easing. 
These changes appear to be more about politics than good policy.
Malcolm Gunning is president of the Real Estate Institute of Australia and can be contacted <a href="https://reia.asn.au" target="_blank">here</a>.
 
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Federal Government should rethink deductibility of investment outgoings, travel: REIA

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EXPERT OBSERVER
The property industry has warned the Federal Government that proposed tax changes will jeopardise the international education sector – Australia’s third largest export earner worth more than $30 billion.
The Treasury Laws Amendment (Making Sure Foreign Investors Pay Their Fair Share of Tax in Australia and Other Measures) Bill 2018 will be the subject of a Senate Inquiry to commence in November, 2018.
If passed, the Bill will result in offshore capital providers to the education sector facing a 100 per cent rise in their withholding tax rate, as the meaning of the words “residential dwelling asset” will include tertiary off campus student accommodation.
This last minute change differs from the exposure draft of the bill released earlier this year, which featured a tax exemption for assets comprising “commercial residential premises”, including student accommodation.
If passed, the bill will severely hurt the international student sector as accommodation for them will dry up quickly. Almost all of the investment in this sector is coming from overseas, yet the government wants to change the rules mid-stream and penalise them for investing in Australia.
Foreign investors have effectively created this property asset class, with 71,000 beds for local and international students have been supplied or being developed by them to date, supporting substantial local jobs in the design, construction and hospitality industry.
The Property Council of Australia has also made a submission to the Senate stating the higher tax rate would have “unintended consequences for the tertiary education sector, which relies on international capital to provide purpose-built student accommodation.
The proposed increase in the tax rate also did not provide any relief for investors who have committed to developments having entered into contracts to acquire sites, prior to September 20, 2018, when the amendments are dated to come into effect.
Not only will the proposed tax changes damage an important export earner for Australia, they will also inflate the rents in the broader rental market as students will be competing for a more limited supply of accommodation.
The sudden changes to the proposed laws will also affect Australia’s reputation with foreign investors who are seeking stability in the rules when they commit capital offshore.
According to the Department of Education and Training, there were 626,988 international students in Australia during July 2018 up 11% on last year.
Trevor Hardie is the CEO of Intergen Property Group, a company which represents overseas investors in student accommodation.
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jrobinson-rf4aSBido9

Proposed Federal tax changes to hit $30 billion international education sector

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EXPERT OBSERVER
It is crucial that the Federal Government continues to provide support to businesses and households in a year of unprecedented economic challenge.
However, whilst the decision to apply US-style Chapter 11 bankruptcy laws that will allow small businesses to trade their way out of insolvency is well-intentioned, it will do little to generate jobs and growth down the track.
In August, RBA Governor Phillip Lowe warned that a considerable number of insolvencies would emerge, with many businesses unlikely to recover from the ‘forced economic hibernation’ imposed in March.
That remains the case, regardless of any legislation that allows companies to continue trading while insolvent.
New CreditorWatch data has shown that new company registrations across Australia have increased by 10% in the July-August 2020 period. However, these companies will fail if they take on customers that are never going to survive without government support
.The focus should therefore be on those small businesses who have a viable capability of emerging from the COVID environment with their balance sheets intact and an ability to successfully trade without government support.
There’s a lot of uncertainty out there for creditors as they don’t quite understand how this will affect then.
Ultimately, if it helps businesses survive or at least flattens the inevitable insolvency curve, it’s a good thing. The government should be commended for working on such big policy changes in short pressure-filled time.
HARLEY DALE is the Chief Economist at CreditorWatch
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j.ballantyne1990-6AQqhLzZaK

Continued government support is crucial to save businesses: Harley Dale

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<img src="https://counter.theconversation.edu.au/content/57114/count.gif" alt="The Conversation" width="1" height="1">
GUEST OBSERVER
The federal government’s Smart Cities Plan is framed around the “30-minute city”. In this city, journeys will take no more than half an hour, regardless of your location.
The recently released plan has significant implications for population, transport provision and land-use intensity in neighbourhoods – the places where people live and how they get around. The realisation of its goals will require ongoing densification of Australian suburbs.
<h2>Cities with more houses, more people, more NIMBYs</h2>
The doubling of the population in some Australian cities by 2045 is likely to generate fierce opposition to housing and transport projects.
Many medium-density housing projects prompt residents to act strategically to protect their neighbourhoods, even when these projects improve housing affordability and access to jobs and services.
Resistance is also directed at major infrastructure. Fierce campaigns are being (or have been) waged against Melbourne’s <a href="https://theconversation.com/the-sky-rail-saga-can-big-new-transport-projects-ever-run-smoothly-54383">“</a>sky rail” project and East West Link, Sydney’s ANZAC Parade light rail and Westconnex projects, and the Perth Freight Link.
Such opposition is not only felt through the planning system. Residents also use political channels to stop projects, as with the East West Link.
<h2>How should government respond to community resistance?</h2>
Contestation over city planning should not be shut down. Rather, we need to think about citizen opposition as a constructive process for working through difference. Here are five points to consider when including people in the delivery of the 30-minute city.
Point 1: We need active governments and active citizens
Private-sector lobbyists argue government is poorly placed to deliver small- and large-scale infrastructure. But think about a city with no roads, sewers, hospitals or schools. Without government-led planning, our cities would be dysfunctional places to live.
However, governments are not benevolent institutions. Active citizenries have long scrutinised the efficacy of government decisions.
The introduction of private and non-government infrastructure providers further complicates the relationship between citizens and governments. Whose interests does urban development then serve – a local community, regional community, or developers?
Governments need to be ready to answer questions about the role of the private sector and to change their plans following community input.
Point 2: More than finding better participation tools
Urban planning systems play important roles in engaging residents. However, community consultation has been sporadic. Neighbourhood meetings and letterbox notifications often fail to ignite engagement.
Then there is the question of representation. Community consultations attract the “usual suspects”. Time-poor working-age households and young professionals find it difficult to fit engagement with planning into their busy lives. Even more rarely does planning engage with youth and children about their visions and hopes for cities.
Local and state governments are aware of the need for new ways to bring citizens into decision-making. Infrastructure Victoria’s citizen jury panels are meeting mid-2016. Social media is also being considered as a way to engage a broader public about city futures.
However, when planning departments use social media the uptake by communities is poor. Our research suggests opponents to planned projects, rather than planning departments, are more likely to use social media.
The problem with current participation tools is their failure to account for conversations, debates and protests that take place outside the formal planning process. We need ways to include these discussions.
Point 3: Moving beyond NIMBYism
Not all community campaigns are the same. The dominant narrative around community participation in urban planning centres on the pejorative idea of “the NIMBY” (not in my backyard).
The term NIMBY is frequently used to delegitimise the claims of citizens opposing planned developments. They are characterised as self-interested residents who resist the inclusion of new social groups in their neighbourhoods, or any change to the built or natural environment.
Deliberately labelling these residents as self-interested fails to recognise the positive roles they can play. Local resident campaigns can focus on city-wide or local issues. They can range from unwavering opposition to more flexible and reflexive engagement in an urban discussion.
Some community campaigns might be viewed as vital forms of urban citizenship. Others are seen as “protecting their patch” against the best interests of the broader citizenry. Both views should be part of our discussion about city planning.
Point 4: The conversation never stops
An active citizenry is involved in short-term “one-off” planning and long-term strategic planning. Too often, public participation roles are confined to one end of this spectrum. For example, the NSW government recently attempted to limit public participation to high-level strategic planning documents, reducing community input into individual developments.
Most people have little knowledge of the urban planning system. A recent study found only 24 percent of Sydney residents surveyed were aware of the Sydney metropolitan plan. Confining participation to upfront strategic consultation limits community involvement.
For most people, engagement with planning and development issues will be reactionary. People engage with the planning system when a development is proposed for their area.
However, a recent national survey revealed that 65 percent of responses believed urban residents should be involved in each stage of the strategy-making process. Most will not be involved, but options for participation should not be confined to upfront consultation.
By engaging the community in an ongoing discussion we can listen and respond to local interests without compromising the broader strategic and long-term vision for our cities.
Point 5: Metropolitan-wide but locally situated debate
There will be winners and losers in the 30-minute city. Houses will be acquired, buildings will be demolished and sections of the natural environment will make way for new infrastructure.
Over the last decade, the idea of consensus has dominated participatory approaches. However, consensus-seeking is not always the best way to work through community disagreement. In some cases, consensus can be manipulative, or useful for mobilising resident opposition.
We need to recognise that cities are home to many different people who hold diverse views and values, and who will not always agree. Rather than aiming for consensus, we should set our sights on metropolitan-wide, locally situated debate, which supports an active citizenry.
In the end, the difference between no action and implementation may be in “agreeing to disagree” through open discussion about the planning of the city.
Crystal Legacy is Australian Research Council (DECRA) Fellow and Vice Chancellor's Research Fellow, Centre for Urban Research, School of Global, Urban and Social Studies, RMIT University and can be contacted <a href="https://theconversation.com/profiles/crystal-legacy-18412" target="_blank">here</a>.
Dallas Rogers is lecturer in Urban Studies, Western Sydney University and can be contacted <a href="https://theconversation.com/profiles/dallas-rogers-5269" target="_blank">here</a>.
Cristian Ruming associate professor in Urban Geography, Macquarie University and can be contacted <a href="https://theconversation.com/profiles/kristian-ruming-173545" target="_blank">here</a>.
Nicole Cook is researcher, School of Geography, University of Melbourne and can be contacted <a href="https://theconversation.com/profiles/nicole-cook-220909" target="_blank">here</a>.
All are authors for The Conversation.
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‘30-minute city’? Not in my backyard! Smart Cities Plan must let people have their say

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The federal government has announced an inquiry into specific cases of mistreatment of small business customers by banks.
It has been interpreted as a bid to take the steam out of Labor's call for a royal commission.
The government made the announcement minutes before Labor leader Bill Shorten moved a motion calling for a royal commission.
Kelly O'Dwyer, the Minister for Revenue and Financial Services, announced the inquiry. 
The Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, will undertake the inquiry "into the adequacy of the law" to address concerns raised by the Parliamentary Joint Committee on Corporations and Financial Services in its report released in May this year.
It will examine selected cases identified by the committee regarding small business lenders to determine whether regulatory action is required.
Mr Shorten's motion, seconded by independent MP Bob Katter, noted that "scandals in the banking and financial services industry have led to retirees having their retirement savings gutted, families being rorted, small business owners losing everything, Life insurance policy holders being denied justice; and agricultural assets being improperly foreclosed; and despite several inquiries, new powers, new resources, and a Financial Ombudsman Service, the rorts and the rip offs continue."
The terms of reference for Ms O'Dwyer's inquiry are:
"In undertaking the inquiry, the Ombudsman should: review a selection of the cases that have been identified by the PJC as unfair and ascertain whether there are any deficiencies in the regulation of authorised deposit taking institutions in lending to small business; 
"refer any matters identified in the review to the relevant authority for further consideration as necessary;
"determine whether the regulatory deficiencies identified by the PJC, or additional deficiencies identified through the inquiry, are being addressed by subsequent Government and industry reforms; and
"recommend whether additional reform measures should be implemented (legislation, regulations, guidance and practices) to ensure products perform in the way they should, taking into account that consumers have a responsibility to accept their financial decisions, including market losses, when they have been treated fairly, and any impact on the availability and cost of credit to small business."
The inquiry will take 12 weeks.
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Bank inquiry announced by Federal Government

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Research on the last election results show seats with the higher numbers of property investors bucked the swing against the Turnbull government.
Analysis by Australian Demographic Strategies, headed by former Labor senator John Black, found seats with large number of investment property owners and people who were negatively geared “voted for the Coalition and swung far less towards the ALP”.
“When we ranked federal seats by per capita investment properties, the top four seats — Reid and Bennelong in NSW, Kooyong in Victoria and Curtin in WA — swung towards the Coalition by an average of 2 per cent, despite a ­national swing of 3 per cent to Labor,’’ ADS reported in an article in The Australian.
“The bottom five seats for per capita investment properties — Bass and Lyons in Tasmania, Macarthur and Chifley in NSW and Blair in Queensland — swung an average of 7.5 percent to the ALP.’’
Treatment of investment property was a significant policy difference between the Coalition and Labor at the July 2 Federal election.
Bill Shorten proposed to limit negative gearing to new properties from July 1 next year and cut the capital gains tax discount from 50 per cent to 25 per cent.
Malcolm Turnbull argued that Labor policy would "smash" property prices and deter investment.
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Labor's negative gearing policy helped keep it from office: research

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The Federal Government has let its housing affordability inquiry lapse.
News of the quashed inquiry emerged through Fairfax Media's commentator Peter Martin as Treasurer Scott Morrison delivered a speech in which he declared housing affordability to be an "important policy focus" of the Turnbull government in the new parliamentary term.
The inquiry was initiated by Morrison's predecessor, Joe Hockey early last year to be undertaken by the House of Representatives economics committee and chaired by Liberal backbencher John Alexander.
Alexander was replaced as chairman by Liberal MP Craig Laundy after hearings concluded in September last year.
Mr Laundy has told Fairfax Media he had worked on a draft report with the committee secretariat.
But he wasn't able to put it to the committee before he was promoted to the ministry and replaced with backbencher David Coleman shortly before the July election.
Under the rules governing committees, the inquiry lapsed with the election, meaning Mr Coleman is unable to conclude the report without a fresh referral from the Treasurer.
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